This is a randomized, double-blind, parallel-group, placebo-controlled multicenter trial. The purpose of the study is to compare the efficacy and safety of the DISKUS formulations of salmeterol 50mcg BID and fluticasone propionate 500mcg BID individually and in combination as compared to placebo in subjects with chronic obstructive pulmonary disease (COPD). The primary measures of efficacy will be pre-dose and 2-hour post-dose FEV1 obtained at each visit. Other measures of efficacy will include 12-hour serial FEV1 assessment of symptoms (Chronic Bronchitis Symptoms Questionnaire and Baseline/Transition Dyspnea Index), severity of COPD exacerbations, time of first exacerbation, time of first moderate or severe exacerbation, number of withdrawals due to COPD exacerbations, subject-determined morning peak flow, supplemental VENTOLIN use, and nighttime awakenings requiring VENTOLIN. Quality of life will also be assessed using the Chronic Respiratory Disease Questionnaire. Safety monitoring, routine laboratory tests, cosyntropin stimulation diagnosis of COPD will be randomly assigned to one of four double-blind treatments for 24 weeks following a 2 week single-blind, run in period. Subjects who develop an exacerbation may be treated with antibiotic therapy as an outpatient for two exacerbations and will be discontinued from the study if a third exacerbation requiring this treatment occurs. If a subject has an exacerbation that requires treatment with systemic corticosteroids or a serious exacerbation requiring hospitalization, the subject will be discontinued form the study.